Brits clinch deal with Russian sovereign fund to boost private equity

Britain and Russia have signed an agreement to boost investment opportunities in Russia for UK-based private equity investors as recent major corporate failures have cast a shadow over the future of British business in Russia.

UK Trade and Investment and the Russian Direct Investment Fund (RDIF) signed the deal during British Prime Minister David Cameron’s visit to Russia, whose apparent task was to try to repair relations heavily damaged by the 2006 Litvinenko affair.

The UK Trade and Investment and RDIF chiefs, Lord Green and Kirill Dmitriev, both said there exist “huge opportunities” for British investment in Russia and vice versa, according to US-based website PRNewswire.

Another remarkable event during Cameron’s visit was the unveiling of a new British medical company, Pro Bono Bio, where Russian state-owned nanotechnology corporation RusNano is taking a stake of more than 40%.

Yet these developments are unlikely to change the overall less-than-radiant picture of British corporate presence in Russia, with two key banks, HSBC and Barclays, pulling the plug on their Russian retail business and BP failing to strike a deal on Arctic shelf exploration with Russian state-owned oil company Rosneft, which opted for ExxonMobil as its partner in the potentially lucrative project.